Topeka’s Victor Anthony Comments On Yahoo! As All Eyes On Tax Avoidance

Topeka Capital analyst Victor Anthony weighed in today with a few insights on Yahoo! (NASDAQ:YHOO), as the company is scheduled to report its earnings results tomorrow (1/27) after the market close. The analyst rates the stock a Buy with $60 price target. 

Anthony wrote, “We are expecting an in-line quarter with upside risks to estimates due to share gains in search as a result of the Firefox win, and greater mobile traction. The plan to avoid tax leakage on the Asian assets will dominate interest on the call and is likely to serve as a meaningful catalyst for the stock. The current share price is pricing in zero tax avoidance at 5.0x 2016 Core EBITDA. Each 10% of tax avoidance on the Alibaba (NYSE:BABA) stake will add $5 per share of value to Yahoo’s share price.”

The analyst is estimating revenues ex-TAC of $1.164B, Adjusted EBITDA of $373M, and Adjusted EPS of $0.27, compared to consensus revenues of $1.186B, Adjusted EBITDA of $366M, and Adjusted EPS of $0.29. Yahoo guided for revenues of $1.140B- $1.180B and Adjusted EBITDA of $340M-$380M.

Yahoo! Inc. operates as a technology company worldwide. The company offers Yahoo Search that serves as a starting point to navigate the Internet and discover information; and Yahoo Answers, which enables users to seek, discover, and share knowledge and opinions across mobile phones, tablets, and desktop. 

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